Prime Minister Anthony Albanese chaired the meeting of National Cabinet in Sydney on Wednesday, which ticked off the changes.
He said the new rules would apply to people with no symptoms and encouraged people who were unwell to remain at home.
Isolation requirements will stay at seven days for workers in high-risk settings such as aged care.
“They are areas where you have people who are particularly vulnerable. We want to make sure those sections are looked after,” Mr Albanese said.
National Cabinet agreed to remove mask mandates on domestic flights from September 9.
“If you have symptoms we want people to stay home and to be responsible,” Mr Albanese said.
The Prime Minister didn’t respond directly to a question about the UK, which dropped all isolation requirements six months ago, and when Australia might follow suit.
“What we want to do is to make sure government responds to changed circumstances. COVID is likely to be around for a considerable period of time and we need to respond to it,” he said.
“We’ll continue to assess these issues and what restrictions are appropriate at any point in time.”
The amount paid out under pandemic leave payments will change from September 9, with the amount to be confirmed in the coming days.
He said a decision on how long the pandemic leave payments would continue would be made in a fortnight’s time.
Premiers had called for the $750 isolation payment, which is slated to finish at the end of September, to continue as long as a mandatory isolation period is in place.
Federal Treasurer Jim Chalmers said the payments could not continue forever.
Housing affordability will also be discussed at the next meeting of National Cabinet.
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